John C. Foley of Central States Development said he could arrange to renovate the hotel under one condition — the assisted living operation must be solvent and profitable.

Foley was at the Pawnee June 17 to meet with executive director Sandy Schade, board president Kathy Jo Smith and key staff members.

Foley’s company has financed the renovation of buildings in four states, including such cities as Omaha, Denver and Hastings, plus communities in Iowa and Kansas.

Foley said the 83-year-old Pawnee Hotel could be completely restored. Rooms could be enlarged for residents and the historical features preserved and protected.

His company, Central States Development LLC, specializes in renovating buildings for low income and special needs residents. Central States utilizes tax credits, affordable housing grants and tax increment financing where applicable.

The Pawnee is home to 40 emotionally and mentally disabled people with special needs.

Since 1998, Foley’s company has arranged financing for more than 20 building renovations, creating nearly 1,000 living units for the homeless, disabled, elderly and people on low incomes, the company said.

Central States partners with “non-profit service providers to create affordable housing for persons with various special needs,” Foley said.

The company’s niche fits the Pawnee operation.

Director Sandy Schade said the Pawnee is suffering financially. The biggest challenges come from the building itself, which requires more and more maintenance.

For more than a year, the assisted living operation has struggled to operate.

Most residents receive about $1,100 a month from Medicaid which pays the hotel for room, board and basic medical needs.

The operation has seldom if ever been profitable. In 2011, its tax report showed a 3.8 percent loss, and Schade said the situation has not improved since.

Financial struggles became obvious last summer when paychecks were chronically late. At about the same time, Nebraska Health and Human Services inspectors found sanitation and maintenance problems throughout the operation. Several residents left and the dwindling staff struggled.

Inspectors returned weekly for inspections and in August, they said some medications were improperly administered, some carpets were torn and dirty and there were bugs in an upstairs hallway.

The HHS officially revoked the assisted living operating license in October, pending an appeal.

In December, the 83-year-old boilers quit working and the staff scrambled to set up temporary heaters. Overhead pipes broke on the second and fourth floors.

During a 45-day period from late November to early January, another 20 residents moved out.

But Schade and the staff endured. They set up heaters and openly discussed the challenges.

In March, the HHS reinstated the hotel’s license to provide assisted living care. A hearing officer found no further deficiencies and said the staff had made a good faith effort to improve.

For the first time in 10 months, in May the hotel was allowed to accept a handful of residents. Schade said there were 25 inquiries.

“The need is there,” she said.

Schade has received offers from volunteers who want to help replace carpets and do minor repairs in the building. She said she needs help with accounting.

Schade said the hotel provides single rooms – something rare in mental health care, making it a good fit for many residents. It has provided assisted living care for more than a decade.

Foley said a list of financial reports would need to be completed before funds could be lined up for restoration.

He challenged Schade and the board to improve the operation.

“You can beat things if you want to,” Foley said.

First published in the June 19 print edition of the North Platte Bulletin.